Bitcoin Less Risky as the Price Rises, Says Bill Miller

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In Brief
  • Bitcoin bull Bill Miller says that bitcoin gets safer the higher the price goes.

  • Bitcoin will act in a certain way because it is early in its adoption cycle.

  • Banks can buy, sell, and hold BTC in custody, but major banks haven't started to do so.

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Famous investor Bill Miller told CNBC that, unlike most equities, Bitcoin’s higher price decreases risk.



In an  interview on the show The Exchange, the CEO and Chief Investment Officer of Miller Value Partners,  explained the nature of Bitcoin’s risk profile.

How can this be?

Miller, who is famous for his S&P-beating track record, pointed to a few factors to back up his statement. In particular, he stated that bitcoin is still at the beginning of its adoption cycle. In other words, there are still more people and institutions to start investing in the asset.



He noted that even though banks are allowed by the regulators to buy and custody BTC, none of them are doing it. He said that they’re held back because they are “concerned”.

Furthermore, there is the supply and demand issue. Institutional investors are coming to the market and making large-scale purchases. “For as long as that obtains,” he said, bitcoin is likely to go higher.

Cash is a rat?

CNBC pointed to Miller’s latest investor news letter for some unusual humor. Miller referenced Warren Buffet’s famous tagging of bitcoin as ‘rat poison’. “He may well be right,” Miller retorted. “Bitcoin could be the rat poison, and the rat could be cash.”

Chasing the bitcoin cycle

Miller also reflected on the issue of ‘waiting for the pullback’. In other words, with BTC moving into uncharted territory, would it make sense to wait until the cycle falls?
The problem with this thinking, he says, is that the bottom already occurred. “You could have bought bitcoin at $4,000 in the first quarter [2020].”

Furthermore, people who look for the bottom tend to miss. They expect the price to keep dropping even after it begins rising. Then when it rises, they’re asking if they should buy it. In essence, they chase the market.

Where next for BTC?

Miller did not give a prediction for bitcoin’s price during the interview. What he did do repeatedly was focus on the fact that bitcoin is early in its adoption cycle.

Because bitcoin is at this early stage, some things can be expected. Miller pointed to the fact that bitcoin moves in jumps. These jumps are followed by dives of up to 80%, he noted. Bitcoin has done this twice, he noted. But he also reiterated – this is natural for an asset at this stage of its investment life.


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James Hydzik is a finance and technology writer and editor based in Kyiv, Ukraine. He is especially interested in the development of regulation in the face of increasingly rapid technological change. He previously covered the CEE region for Financial Times banking and FDI magazines. An ardent believer in gut renovating eastern Europe one flat at a time, he currently holds more home renovation gear than crypto.

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